Latest news with #JuanPerez
Reuters
04-08-2025
- Business
- Reuters
US dollar gains in consolidation move after Fed turmoil, Trump's shake-up
NEW YORK, Aug 4 (Reuters) - The U.S. dollar slightly recovered on Monday, consolidating recent moves, after Friday's trio of market-moving events that showcased the fragility of the greenback: a dismal U.S. jobs report, the resignation of a Federal Reserve Governor, and President Donald Trump's firing of a top statistics official. Those developments battered the currency and prompted investors to ramp up bets of imminent Fed rate cuts. But the dollar's bounce on Monday could be short-lived, analysts said, and the broader downtrend could re-emerge given U.S. policymaking uncertainty and a U.S. economy that is finally showing cracks. Data on Friday showed U.S. employment growth undershot expectations in July while the nonfarm payrolls count for the prior two months was revised down by a massive 258,000 jobs, suggesting a sharp deterioration in labour market conditions. "The U.S. seems to be ... experiencing a slowdown across industries that are doubting the benefits to arrive from deterring overseas production and purchasing," said Juan Perez, director of trading at Monex USA in Washington. "The world is not necessarily experiencing much optimism even as economic indicators here help in suggesting that aid will come from the Fed via rate cuts," he added. In afternoon trading, the dollar rose against the euro, Swiss franc, and the commodity-linked currencies such as the Australian and New Zealand dollars. The euro dipped 0.1% against the U.S. unit to $1.1576 , while the dollar rose 0.5% against the Swiss franc to $0.8078 . The drop in the Swiss currency was not a surprise after Trump hit Switzerland with some of the highest tariffs as part of the White House's global trade reset. The Aussie and New Zealand dollars also declined on Monday versus the greenback, falling 0.2% to US$0.6463 and down 0.3% at US$0.5904 . Against the Swiss franc, the dollar rose 0.5% at 0.8081 . Versus the yen, the U.S. currency gained 0.3% to 146.945 . "July's rebound in the dollar ran into a wall last week, but so far there's no sign of a big jump in any risk premium for holding U.S. assets," said Karl Schamotta, chief market strategist, at Corpay in Toronto. "Strong corporate earnings are - so far - managing to overshadow fears of an incipient slowdown in labor markets, the impact of higher tariffs, the threat to the independence of U.S. statistical agencies, and the growing likelihood that the next Fed chair tries to lead monetary policy in an inflation-boosting dovish direction," he said. In other developments, Trump fired BLS Commissioner Erika McEntarfer on Friday, accusing her of faking the jobs numbers. An unexpected resignation by Fed Governor Adriana Kugler also opened the door for Trump to make an imprint on the central bank much earlier than anticipated. Trump has been at loggerheads with the Fed for not lowering interest rates sooner. The developments sent the dollar down more than 2% against the yen and roughly 1.5% against the euro on Friday. The euro slipped 0.2% on Monday to $1.1568 , while sterling was little changed at $1.3275. Trump said on Sunday he will announce a candidate to fill the open position at the Fed and a new BLS head in the next few days. Against a basket of currencies, the dollar edged up 0.1% to 98.77, after sliding more than 1.3% on Friday. The dollar rose 3.4% in July, its biggest monthly gain since a 5% jump in April 2022 and first monthly rise of the year, as markets became more at ease with Trump's trade policy and economic data had remained resilient in the face of tariffs. In other markets, the policy-sensitive two-year Treasury yield fell to a three-month low of 3.659% on Monday as traders heavily raided bets of a Fed cut in September, while the benchmark 10-year yield strayed not too far from a one-month low at 4.2257%. Markets are now pricing an 84% chance the Fed will ease rates by a quarter-point next month owing to the weaker than expected jobs data, according to CME's FedWatch, with just under 60 basis points worth of cuts expected by December, implying two 25 basis point cuts and a 40% chance of a third.
CNA
14-07-2025
- Business
- CNA
Dollar at more than two-week high versus yen as trade war heats up
NEW YORK :The dollar hovered near more than a two-week high against the yen on Wednesday as U.S. President Donald Trump announced tariffs on seven countries, after earlier this week imposing 25 per cent tariffs on Japan and other trade partners beginning in August. . The greenback advanced against major peers on Tuesday after Trump issued a round of tariff letters to countries including Algeria, Iraq, Libya, Sri Lanka and the Philippines. Those tariffs - as high as 30 per cent - are due to start on August 1, but Trump said he was open to extensions if countries made proposals. Trump said on social media that tariff letters to additional countries would be released later Wednesday afternoon, without specifying any details. Despite recent gains, the dollar index, which measures the greenback against six major peers, is still down more than 6 per cent since Trump on April 2 unveiled his sweeping "Liberation Day" reciprocal tariffs, which prompted a sell-off in markets but were later mostly postponed to give time to negotiate bilateral trade deals.\ "There's been a lot of turbulence in holding the U.S. dollar," said Juan Perez, director of trading at Monex USA. "Where do we go now? Well, the uncertainty remains, and I know that that's a frustrating thing to hear, but this is going to be a roller coaster ride in which ... you're going to have to start embracing and accepting is just part of doing business." Trump has also threatened a 50 per cent tariff on imported copper and said he would soon introduce long-threatened levies on semiconductors and pharmaceuticals. The dollar was down 0.18 per cent at 146.35 yen, after touching 147.19 earlier in the session. The U.S. currency has gained around 1.5 per cent so far this week - the greenback's biggest weekly rise since mid-December. Export-dependent Japan stands out among major U.S. trading partners as being the farthest from a deal, and its currency has taken a beating. Multiple rounds of talks have failed to result in a breakthrough, and Japanese policymakers are increasingly focused on a critical upcoming election. Speculation that opposition parties will gain seats in Japan's upper house and push for more fiscal stimulus has sent Japanese government bonds (JGBs) lower this week, causing a spike in long-term yields. U.S. Treasury Secretary Scott Bessent, who has been a key trade negotiator with Tokyo, is expected to attend the World Expo 2025 in Osaka, Japan, later this month, potentially opening the door for more discussions. The euro slipped 0.09 per cent to $1.171 as investors cautiously weighed the likelihood that the European Union would not receive a tariff letter and could secure exemptions from the U.S. baseline rate of 10 per cent, EU sources familiar with the matter told Reuters. Minutes from the Federal Reserve's June 17-18 policy meeting on Wednesday showed that only "a couple" of officials said they felt interest rates could be reduced as soon as this month, with most policymakers remaining worried about the inflationary pressure from Trump's tariffs. Antje Praefcke, an FX analyst at Commerzbank, credited the euro's strength against the dollar also to markets pricing in interest rate differentials between the U.S. and Europe. "The market is now pricing in just under two interest rate cuts by the Fed by the end of the year, but only one by the ECB." The dollar index inched down 0.003 per cent to 97.545, while sterling was down 0.04 per cent at $1.36.
Business Recorder
10-06-2025
- Business
- Business Recorder
Dollar dips after jobs-fueled rally
NEW YORK: The US dollar slipped against most major currencies on Monday, as optimism over a better-than-expected US employment report was offset by caution ahead of pivotal US-China trade talks set to take place later in the day. Top officials from both countries were in London for a meeting to address disagreements around a preliminary agreement struck last month in Geneva, which had briefly cooled tensions between the world's two largest economies. The talks come at a crucial time for both sides, with China grappling with deflation and trade uncertainty dampening sentiment among US businesses and consumers, prompting investors to reassess the dollar's safe-haven status. Data showed China's export growth slowed to a three-month low in May as US tariffs slammed shipments, while factory-gate deflation saw its worst level in two years. Customs data showed that China's exports to the US plunged 34.5% year-on-year in May in value terms, the sharpest drop since February 2020, when the outbreak of the COVID-19 pandemic upended global trade. The dollar was down about 0.2% against the Japanese currency at 144.635 yen in late morning trading after two consecutive weeks of gains. Japan is considering buying back some super-long government bonds issued in the past at low interest rates, two sources with direct knowledge of the plan said on Monday, underscoring its focus on reining in any abrupt rises in bond yields. The euro, meanwhile, was up slightly against the greenback at $1.1404, as markets continued to price in the European Central Bank's monetary policy outlook issued last week, in which it indicated it may be close to ending its easing cycle. Sterling also rose versus the greenback, adding 0.3% to $1.3558. 'The dollar is struggling to find clear direction following last week's data points and the situation is looking more like the second half of the year the Fed will need to get dovish and help the financial environment,' said Juan Perez, director of trading at Monex USA in Washington. 'Ultimately, if the US is going to be struggling, there is no clear reason to have any long-term faith in the dollar.' Elsewhere, China's offshore yuan was last at 7.18 per dollar, little changed on the day. 'How the (US-China) trade talks go definitely is going to be critical for overall sentiment,' said Kit Juckes, chief FX strategist at Societe Generale. He said Asia-Pacific currencies including the Japanese yen and Australian and New Zealand dollars would likely see the biggest reaction to headlines from the talks. New Zealand's dollar rose 0.5% to US$0.6045, while the Australian dollar was last up 0.3% at US$0.6515 in light volumes as markets were closed for a public holiday. Also on the trade front was a report that said Japan's chief trade negotiator Ryosei Akazawa is planning a sixth round of talks in Washington. An inflation report out of the US for May will be in the spotlight later in the week as investors and Federal Reserve policymakers look for evidence on the damage trade restrictive policies have had on the economy. Fed officials have signalled that they are in no rush to cut interest rates and signs of economic resilience will likely cement their stance. Interest rate futures indicate that investors are anticipating the central bank may cut borrowing costs by 25 basis points, with the earliest move expected in October this year, according to data compiled by LSEG. 'May is the first month where the impact of Trump's 10% universal tariff on imports ex-USMCA (United States-Mexico-Canada Agreement) is expected to show. The Fed will want a few months of inflation data in order to judge the tariff impact and most importantly, its persistence,' analysts at ANZ Bank said.
Business Times
18-05-2025
- Business
- Business Times
Greenback rises to fourth straight weekly gain on latest US economic data
THE dollar strengthened on Friday (May 16) after the latest round of economic data showed a rebound in import prices while consumer sentiment remained subdued as tariff worries jumped, putting it on pace for a fourth straight weekly advance. The US Labor Department said import prices gained 0.1 per cent last month after dropping 0.4 per cent in March as a jump in the cost of capital goods outweighed cheaper energy prices. Economists polled by Reuters had forecast import prices, which exclude tariffs, would decrease 0.4 per cent. The dollar began to strengthen after a separate reading from the University of Michigan Surveys of Consumers showed its Consumer Sentiment Index dropped to 50.8 this month, below the 53.4 estimate, from a final reading of 52.2 in April. In addition, the 12-month inflation expectations of consumers shot up to 7.3 per cent, the highest level since November 1981, from 6.5 per cent. The greenback began last week with a surge of more than 1 per cent on Monday after the United States and China announced a 90-day pause on most of the tariffs imposed on each other's goods since early April, easing fears of a global recession, but had been trending lower throughout the week in part due to tepid economic data. 'There's all this data, but the headlines are taking over,' said Juan Perez, director of trading at Monex USA in Washington. 'The issue with (trade) developments is that they're just happening a whole lot faster, and the ongoing, never-ending lack of guidance for the future continues. Meanwhile, we're looking at data that is not truly reflecting all of the anxiety that we've really been living through.' BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The dollar index, which measures the greenback against a basket of currencies, rose 0.36 per cent to 101.13, with the euro down 0.37 per cent at US$1.1146. The greenback is up about 0.7 per cent on the week, which would mark its biggest weekly gain in about two-and-a-half months, while the euro is down 0.9 per cent on the week, and on track for its biggest weekly decline since early February. The greenback is still down nearly 3 per cent since Apr 2, when US President Donald Trump announced his spate of tariffs on countries around the globe. 'The very idea that trade is not getting away from turbulence continues to affect the long-term faith in the dollar,' said Perez. Markets have dialled back expectations for rate cuts from the US Federal Reserve this year as a result of the signs of easing trade tensions, pricing in a 67.1 per cent chance for the first cut of at least 25 basis points at the central bank's September meeting, according to LSEG data. The prior view was for a likely cut in July. Recent comments from Fed officials have indicated the central bank needs more data to determine the impact of the tariff announcements on prices and the economy before adjusting policy. Against the Japanese yen, the dollar strengthened 0.16 per cent to 145.89. Japan's economy shrank for the first time in a year and at a faster pace than expected, data for the March quarter showed on Friday. The dollar was up 0.4 per cent last week against the yen. Japanese Finance Minister Katsunobu Kato said he would seek to discuss foreign exchange issues with US Treasury Secretary Scott Bessent on the understanding that excessive currency volatility is undesirable, and hopes to meet with Bessent this week. REUTERS
Business Recorder
17-05-2025
- Business
- Business Recorder
US dollar climbs after data
NEW YORK: The dollar rose on Friday after the latest round of economic data showed a jump in import prices while consumer sentiment remained subdued, putting it on pace for a fourth straight weekly advance. The Labor Department said import prices gained 0.1% last month after dropping 0.4% in March as a jump in the cost of capital goods outweighed cheaper energy prices. Economists polled by Reuters had forecast import prices, which exclude tariffs, would decrease 0.4%. The dollar began to strengthen after a separate reading from the University of Michigan Surveys of Consumers showed its Consumer Sentiment Index dropped to 50.8 this month, below the 53.4 estimate, from a final reading of 52.2 in April. In addition, the 12-month inflation expectations of consumers shot up to 7.3% from 6.5%. The greenback began the week with a surge of more than 1% on Monday after the United States and China announced a 90-day pause on most of the tariffs imposed on each other's goods since early April, easing fears of a global recession, but has trended lower since in part due to tepid economic data. 'There's all this data, but the headlines are taking over,' said Juan Perez, director of trading at Monex USA in Washington. 'The issue with (trade) developments is that they're just happening a whole lot faster, and the ongoing, never-ending lack of guidance for the future continues. Meanwhile, we're looking at data that is not truly reflecting all of the anxiety that we've really been living through.' The dollar index, which measures the greenback against a basket of currencies, rose 0.31% to 101.08, with the euro down 0.26% at $1.1158. The greenback is up about 0.7% on the week, which would mark its biggest weekly gain in about 2-1/2 months, while the euro is down 0.8% on the week, and on track for its biggest weekly decline since early February. The greenback is still down nearly 3% since April 2, when US President Donald Trump announced his spate of tariffs on countries around the globe. 'The very idea that trade is not getting away from turbulence continues to affect the long-term faith in the dollar,' said Perez. Markets have dialed back expectations for rate cuts from the US Federal Reserve this year as a result of the signs of easing trade tensions, pricing in a 65.9% chance for the first cut of at least 25 basis points (bps) at the central bank's September meeting, according to LSEG data. The prior view was for a likely cut in July. Against the Japanese yen, the dollar strengthened 0.24% to 146.02. Japan's economy shrank for the first time in a year and at a faster pace than expected, data for the March quarter showed on Friday. The dollar is up 0.4% for the week against the yen. Japanese Finance Minister Katsunobu Kato said he would seek to discuss foreign exchange issues with US Treasury Secretary Scott Bessent on the understanding that excessive currency volatility is undesirable and hopes to meet with Bessent next week. Sterling weakened 0.31% to $1.3256 and is down 0.4% on the week.
